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IoT and Blockchain: A Happy Marriage or a Messy Divorce?

blockchain and IoT

The Internet of Things has its problems. Even the biggest advocate for IoT tech will admit there’s a lot of work ahead. Scalability and security seem to be major issues on the horizon, and the jury’s still out on whether blockchain can be part of the solution. Speaking to a blockchain evangelist is enough to leave one quivering with excitement about its possibilities. Cross paths with a skeptic, and the blockchain seems to be little more than smoke and mirrors.

“Blockchain will reshape the future,” enthuses Drew Prindle at Digital Trends. “This blockchain buzz will die soon,” barks Dary Merckens at Gunner Technology. So, what is (and what isn’t) going on with blockchain and IoT that’s dividing so many people?

One of the issues that the naysayers cite is the fact that blockchain technology requires a lot of computational horsepower, due to proof of work. While this isn’t much of a problem for a server, it’s not ideal for an IoT device that’s designed for low power and low usage.

“Overkill” is another issue cited by blockchain detractors. AWS partner Gunner Technology is a case in point. Says Merckens:

“We prototyped a delivery confirmation mechanism using a simple AWS IoT button and blockchain-based smart contracts. Needless to say, it was overkill for our project, and in all likelihood, similar blockchain-based IoT solutions will also be overkill. I’m urging people at this point to abandon the hype and to focus on proven technologies that do everything we need.”

But what about the companies successfully using blockchain with IoT?


ZEDEDA leverages Unikernal technology to build a cloud-native edge computing platform. It’s designed to enable the hyper-scale required for real-time​ IoT​ edge applications, from self-driving cars to industrial robots. This cloud-native solution creates the framework required for blockchain integration within IoT.

Joel Vincent, the company’s CMO, explains, “As the world becomes more cyber-physical and connected, we’re creating cloud-native edge computing that will take the principles of cloud computing, allow developers to move applications to edge systems and out of the data center, ultimately shrinking the concept of real time… to microseconds to interpret data and make a car swerve. We’re doing this with a combination of distributed computing, peer-to-peer crypto-routing, embedded virtualization, and soon blockchain and smart contracts.”

Vincent believes that blockchain tech is pivotal to IoT’s success, postulating that the real value lies in “data provenance as well as value exchange.”

A data provenance service would allow an app developer to add devices to the network and have every piece of data tracked. The data could only be accessed by others with the express permission of the originator. “This service can be provided to that app by a platform via smart contracts and blockchain,” Vincent says.

Value exchange would remove the problem of ROI from having expensive technology in latent devices. When devices need to temporarily connect, “such as in a public safety app in a Smart City,” security cameras could collaborate through the blockchain, as needed, until the task was completed. Every security camera owner would be compensated and their camera then re-released.


Aricent is a design and engineering company whose clients include IBM and Amazon. Aricent specializes in AI and IoT, and helps clients deploy blockchain tech to strengthen and protect their IoT networks. This improves revenue and profitability for software development processes.

The company’s head of security, Shaan Mulchandani, explains, “What we’ve done is basically created a blockchain-enabled DevOps solution.”

Implementing layers of security in their processes, Aricent takes a software development life cycle and translates the process into smart contracts that enforce development in a particular way. Where there are organizations co-developing, there is complete visibility into how the product is being developed and who is contributing.

Aricent uses blockchain tech to ensure the security of IoT devices from the very start. Says Mulchandani, “Increased developer efficiency, increased collaboration, and accountability – when somebody doesn’t perform an action in the time they’re supposed to, it’s easy to pinpoint exactly where it went wrong.”

What About Computational Power?

“There are blockchain technologies on the horizon that use different schemes (proof of stake versus proof of work, etc.) that reduce the horsepower required and increase the transactions per second dramatically over what’s available currently,” Vincent explains.

“With the blockchain being part of the edge environment (not necessarily on the microcontroller class devices), this wouldn’t be as much of a problem to accomplish the goals of data provenance and peer-to-peer transactions for app hosting.”

Mulchandani agrees there are ways around this problem. “With computation, this is getting better, the proof of work is very computationally intensive, but we are moving away from proof of work to proof of elapsed time, which is far more conducive to low-power devices and devices that are latent a lot of the time. Where storage is a problem, we’re moving to Tangle and other protocols.”

What About Overkill and Marketing Hype?

“I first used the internet at MIT in 1991,” Vincent recalls. “We exchanged documents with other universities. Then people said it would change commerce. It sounded crazy. In 2001, my credit union started “online banking.” I declined, reasoning that I would NEVER put my bank account on the internet. Last month, I closed a mortgage without visiting a single bank.”

Mulchandani can understand the disillusionment among many in blockchain tech. “In the sense that it’s an overkill, there has been a lot of marketing hype, to blockchain-ize everything. 80-90 percent of the use cases that are thrown out, one has to ask, why blockchain? We don’t need all this computational power, and it often becomes a problem of storage. You can’t or needn’t use blockchain for everything.”

So, will it be a happy marriage, or a messy divorce for IoT and blockchain? It pays to remember that blockchain tech is still very new, and it could be some years before we see mass adoption. “We’ve reached the peak of inflated expectations,” says Mulchandani, “but it’s early days and we’re moving in the right direction.”

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